Pisco_Ssour
11-11-2004, 03:40 AM
First and foremost, buy the amount and type of insurance you need. Remember: if your policy limit is less than 80% of the replacement cost of your home, you will face a "coinsurance penalty," which means you'll have out-of-pocket expenses to cover costs beyond your policy's deductible. For example: Your home's estimated replacement value (RCV) is $100,000. The co-insurance clause requires you carry at least $80,000 (80% of your RCV), so you would be underinsured by half if you bought a $40,000 policy. In such a scenario, the company would pay half of a loss less the policy deductible - so if you had a $500 deductible and suffered a $10,000 covered loss, your policy would only pay $4,500.
Also, figure out how much personal property insurance and personal liability coverage you need. Personal property, like a home, should be insured for its replacement value. Personal liability is a bit more subjective, but limits should not be less than those on other liability insurance such as auto. Seek advice from a financial or legal professional if in doubt. Finally, think about the extras you could add to your policy. For example, do you want the personal property replacement cost endorsement or the earthquake endorsement? Finally, once you have decided on the coverage you want, you can decide which insurer you would like to purchase the insurance from. You should also decide whether you would like an insurance agent to help you make decisions or you want to buy the product directly from an insurer without an agent.
Also, figure out how much personal property insurance and personal liability coverage you need. Personal property, like a home, should be insured for its replacement value. Personal liability is a bit more subjective, but limits should not be less than those on other liability insurance such as auto. Seek advice from a financial or legal professional if in doubt. Finally, think about the extras you could add to your policy. For example, do you want the personal property replacement cost endorsement or the earthquake endorsement? Finally, once you have decided on the coverage you want, you can decide which insurer you would like to purchase the insurance from. You should also decide whether you would like an insurance agent to help you make decisions or you want to buy the product directly from an insurer without an agent.